Transport Modal Choice by Multinational Firms: Firm-level Evidence from Southeast Asia

Discussion Papers


by HAYAKAWA Kazunobu , TANAKA Kiyoyasu , and UEKI Yasushi

November 2011


We examine transport modal decision by multinational firms to shed light on the role of freight logistics in multinational activity. Using a firm-level survey in Southeast Asia, we show that foreign ownership has a significantly positive and quantitatively large impact on the likelihood that air/sea transportation is chosen relative to truck shipping. This result is robust to the shipping distance, cross-border freight, and transport infrastructure. Both foreign-owned exporters and importers also tend to use air/sea transportation. Thus, our analysis presents a new distinction between multinational and domestic firms in their decision over transport modes.

Keywords: Transport mode, Logistics, Multinational firms, Multinomial logit
JEL classification: F15, F23, R41

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